FEMA Flood Maps and What You Need to Know about Flood Insurance Rate Maps
Hurricane! Tornado! Fire! Earthquake!
So many terrible things can happen to your home. But did you know that flooding is the number one natural disaster we face in the U.S.?
All it takes is a few inches of water to cause catastrophic damage to your property. And if you don’t have flood insurance, a flood can ruin your finances now and in the future. That means taking on a second job, raiding the retirement account, or even forgoing retirement to earn enough money to repair flood damage.
Buying flood insurance is much different than buying homeowners insurance. When it comes to homeowners insurance, the company just figures out what your house is worth and what it would cost to repair it, then they factor in the chances of a loss and those rates are pretty standard. With flood insurance, two houses side-by-side may pay different rates for the same coverage and insurance amounts.
Yes, flood insurance is confusing. That’s why you need a Flood Nerd as your sherpa to guide you through the process and help you avoid common pitfalls like overpaying or underinsuring.
In this page, your trusty Flood Nerd will guide you through the complexities of FEMA flood maps, 100-year flood zones, and what to do if a new flood map affects your home. Heck, I’ll even show you how to determine your flood zone.
Why FEMA Flood Maps Were Created
In 1968, Congress passed the National Flood Insurance Act of 1968. Many private insurers had abandoned the flood insurance market and people struggled to get coverage for their homes and businesses.
The Federal Emergency Management Administration was charged with providing flood insurance, encouraging and supporting floodplain management, and developing maps of flood hazard zones.
The first task resulted in the National Flood Insurance Program (NFIP) which started covering flood risks in 1973.
The second task helped communities identify and reduce the risks of flood disasters and make those communities and their residents safer from floods.
The third task for creating maps was supposed to facilitate the other two tasks. In theory at least.
In practice, this Congressional action created a 50-year monopoly on the flood insurance market. Private insurers were locked out, even though they increasingly had access to technology that allowed them to better calculate the risk of flooding more accurately than relying on maps.
How FEMA Flood Maps are Created
FEMA’s Risk Mapping Assessment and Planning Program is the official process used to create FEMA flood maps. These maps are the Flood Insurance Risk Maps (FIRM) that identify special hazard areas at high risk of flooding. They are the work product created by studying an area’s history of flooding, looking at what flood mitigation features are in place, and then analyzing the risk and creating a map. Then FEMA may or may not meet with community officials to get their input. Once the map is issued, the public has 90 days to comment and appeal. As you can imagine, all this bureaucratic work takes lots of time. After all, they are the government and they are here to help!
FEMA is required to update the flood maps every five years. But the United States is huge and updating those maps doesn’t always happen on time. A Department of Homeland Security report by the Auditor General found 58% of all of FEMA’s maps are outdated.
That’s important because changes in land use alters the way water flows. And when a flood map reaches its 5th birthday without an update the risk level moves to “unknown”.
These flood maps can also cause confusion because they give rise to the 100-year and 500-year floods. They aren’t what you think!
What is a 100-Year Flood Zone?
One thing FEMA has done a great job with is confusing the insurance-buying public.
Have you ever heard the term 100-year flood zone? It doesn’t mean what you think it means.
It sounds like a lovely place that only floods every 100 years. So, if it flooded 5 years ago you are good for another 95 years. Right?
WRONG! A 100-year flood zone means that on any given day you have a 1% chance of flooding. Now that’s a horse of a different color!
The myth of the 100-year flood is dangerous. That’s because, over the span of a 30-year mortgage, there is a 1-in-4 chance of a flood happening. Over a 100-year period, there is a 67% chance of a flood. Trust this Flood Nerd, I did the math for you!
How Flood Maps are Used
When you take out a mortgage to buy a home there’s about a 100% chance that the lender will check to see if the property is located in an area at risk for flooding.
That’s because federal law requires any lender with access to federal money or backed by federal money (and that’s just about all of them) to obtain a flood zone determination (FZD) before they make a loan. The FZD is an official document that tells the lender if flood insurance is required on the property. The FZD is generated based on FEMA’s flood insurance maps.
If the property is on a high-risk flood zone map (usually identified as A or AE or V or VE) you will be required to buy flood insurance. If your property is in another zone, you should still buy flood insurance, but it’s not required.
How Do I Know If I Am In a Flood Zone?
Flood zones are technically special hard areas. In most cases, the flood maps will show the community’s flood zones, the floodplain boundaries, and the Base Flood Elevation (BFE) which is how high the floodwaters are determined to go.
FEMA provides a digital tool to look up flood zone maps online. Use the link to find your community flood map by entering your address. The map will show the area of the floodplain. Diagonal multicolored lines are the floodway and the light blue and tan colors are used to indicate the flood zones.